Klarna applied to establish an FDIC-insured U.S. bank in Utah, which if granted, would allow the company to fund loans with customer deposits, expand into traditional banking products, and pull more of its payments, lending, and merchant operations in-house, instead of relying on third-party banking partners. Klarna Bank USA would be led by Gary Harding, former Chairman & CEO of Milestone Bank and former President & CEO of Prime Alliance Bank. Klarna already holds a full banking license in the EU, where it's operated as a licensed bank since 2017.
CEO Sebastian Siemiatkowski said:
“We've seen firsthand the appetite for a fairer, more transparent approach in the U.S., and our own banking license is the natural next step, giving customers tools to borrow responsibly and build financial confidence, while bringing greater competition, innovation, and choice to consumers and merchants alike.”
If the move sounds familiar, it's because every fintech wants to be a U.S. bank now. In December 2025, I reported that PayPal applied for a banking license, joined by Affirm in January 2026. Mercury, Revolut, Sezzle, Upstart, Mission Lane, Circle, and Ripple, among other fintechs and BNPL firms, have also applied for banking charters, or announced plans to do so, in recent months.
It hasn't been easy to become a bank, until recently.
What changed is the regulatory environment surrounding nontraditional bank charters. The Office of the Comptroller of the Currency has begun approving national trust bank charters for crypto and payments firms, allowing them to operate under federal banking supervision without taking insured deposits or offering checking and savings accounts.
At the same time, the FDIC has revived support for industrial loan company charters, which let commercial and payments firms offer lending and certain banking services while avoiding Federal Reserve oversight under the Bank Holding Company Act, lowering the barrier for fintechs and large brands to pursue bank-like status.
I'm in favor of more banks. The industry needs more competition for the benefit of consumers. There are around 4,379 FDIC-insured banks and savings institutions in the U.S. today, down sharply from more than 14,000 in the mid-1980s after decades of consolidation. The industry has long been dominated by the same large incumbents, with only a handful of new banks chartered each year until a recent small uptick began in the early 2020s. It's estimated that the top four U.S. banks, JPMorgan Chase, Bank of America, Wells Fargo, and Citi, hold roughly 45% of all U.S. bank deposits, and the top 10 banks hold a 65% share.
The space is ripe for competition and innovation, which can only come from dishing out more banking charters. The banking industry is overdue for a competitive correction.
